Fiscal 2008 Financial Results (ended March 31, 2008) Q&A Summary

Q What do you think of the business performance for fiscal 2008, ended March 31, 2008?
A After Matsushita achieved an operating profit to sales ratio of 5% in fiscal 2007 following a period of "deconstruction and creation," all employees worked together to achieve full-scale growth, which was then directly reflected in daily business activities. Rather than financial results, I am more impressed with the strong desire of the employees to achieve full-scale growth.
Q In fiscal 2009, ending March 31, 2009, Matsushita aims for a year on year sales increase of 7%, or 600 billion yen, excluding the effects of JVC's deconsolidation and a stronger yen. Won't it be hard to achieve an increase in both sales and profits in Japan and North America?
A In the AVC business, the simultaneous introductions of plasma TVs and other key products in North America, as well as the reappraisal of Matsushita's product competitiveness by major mass retailers, has led to steady orders. In addition, the Company sees the Beijing Olympics as a major business opportunity for fiscal 2009. Meanwhile, Matsushita is expanding sales in the Middle East and emerging markets like Russia; for instance, there has been significant sales growth in 103-inch plasma TVs. Thus, we see no reason to be overly pessimistic.
Q Matsushita's fiscal 2009 financial forecast assumes that rationalization will offset the negative effects of a strong yen and rising raw materials prices on earnings. What do you think of the effects of an increase of steel prices? Will the Company increase product prices as a result?
A Raw material prices have increased more than expected, although an increase in prices for raw materials is already considered in the fiscal 2009 business plan. However, it won't be easy to raise prices to reflect the increases, since competition in the electronics industry is severe. The Company has to leverage its knowledge to reduce costs by more than the increase in raw material prices.
Q In fiscal 2009, Matsushita expects overseas sales to increase by 12% from the previous year. Which regions are expected to drive this increase?
A Sales in North America are recovering as a result of product line-up expansion. In Europe, the economic outlook is worrying, but Matsushita made a good start toward its goal of double-digit overseas growth in the UK, Germany and France, as well as in some Eastern European nations. Our forecast for double-digit sales growth in overseas sales is founded on well-balanced growth across all overseas regions.
Q What results were produced by the Manufacturing Innovation Division, established a year ago?
A In fiscal 2008, the Manufacturing Innovation Division was comprised of four subcommittees: the Manufacturing Subcommittee, the V-products Subcommittee, the Global Marketing Subcommittee, and the Management Subcommittee. Each subcommittee posted successes, but the most important was the synergies created by linking these subcommittees together. In fiscal 2009, the New Business Creation Project, originally part of the V-products Subcommittee, has become a fifth subcommittee, called the New Business Creation Subcommittee.
Q Why was fiscal 2008 sales volume (on a shipment basis) for flat-panel TVs lower than Matsushita initially expected?
A In LCD TVs, the Company had difficulty in procuring LCD panels. In addition, plasma TV sales volume was lower than initially estimated, as Matsushita focused on optimizing earnings by improving the product mix rather than pursuing volume. However, in monetary terms flat-panel TV sales were in line with Company's estimates, due mainly to increased demand for larger TVs and the success of the VIERA Link.
Q What do you anticipate for LCD panel procurement in fiscal 2009?
A Matsushita expects that supply-demand will remain tight, although things will be better than in fiscal 2008.
Disclaimer Regarding Forward-Looking Statements
  This Q&A includes forward-looking statements (within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934) about Matsushita and its Group companies (the Matsushita Group). To the extent that statements in this Q&A do not relate to historical or current facts, they constitute forward-looking statements. These forward-looking statements are based on the current assumptions and beliefs of the Matsushita Group in light of the information currently available to it, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause the Matsushita Group's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. Matsushita undertakes no obligation to publicly update any forward-looking statements after the date of this Q&A. Investors are advised to consult any further disclosures by Matsushita in its subsequent filings with the U.S. Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934.
  The risks, uncertainties and other factors referred to above include, but are not limited to, economic conditions, particularly consumer spending and corporate capital expenditures in the United States, Europe, Japan, China and other Asian countries; volatility in demand for electronic equipment and components from business and industrial customers, as well as consumers in many product and geographical markets; currency rate fluctuations, notably between the yen, the U.S. dollar, the euro, the Chinese yuan, Asian currencies and other currencies in which the Matsushita Group operates businesses, or in which assets and liabilities of the Matsushita Group are denominated; the ability of the Matsushita Group to respond to rapid technological changes and changing consumer preferences with timely and cost-effective introductions of new products in markets that are highly competitive in terms of both price and technology; the ability of the Matsushita Group to achieve its business objectives through joint ventures and other collaborative agreements with other companies; the ability of the Matsushita Group to maintain competitive strength in many product and geographical areas; the possibility of incurring expenses resulting from any defects in products or services of the Matsushita Group; the possibility that the Matsushita Group may face intellectual property infringement claims by third parties; current and potential, direct and indirect restrictions imposed by other countries over trade, manufacturing, labor and operations; fluctuations in market prices of securities and other assets in which the Matsushita Group has holdings or changes in valuation of long-lived assets, including property, plant and equipment and goodwill, and deferred tax assets; future changes or revisions to accounting policies or accounting rules; as well as natural disasters including earthquakes and other events that may negatively impact business activities of the Matsushita Group. The factors listed above are not all-inclusive and further information is contained in Matsushita's latest annual report on Form 20-F, which is on file with the U.S. Securities and Exchange Commission.

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